Introduction to Decarbonization Trends
As we step into 2025, corporate sustainability efforts enter into a new era. Thanks to evolving energy markets, more stringent environmental regulations, and increasing stakeholder pressure, businesses are adapting their strategies to meet climate goals while protecting their bottom line, too.
Here at Zeigo, we spoke with our team of experts to see what key trends and shifts are expected to impact business decarbonization strategies in 2025.
Governmental Policies and Regulatory Changes
Some of the largest environmental regulations in the world will take effect in 2025, requiring businesses to develop or adjust their strategies to remain nimble and proactive in their approach to sustainability.
Leveraging Compliance
In 2025, expansive environmental regulations will start to take effect, such as the EU’s Corporate Sustainability Reporting Directive (CSRD). Tens of thousands of companies across the globe will be required to align with stringent sustainability standards starting as early as this year, bringing about a new wave of corporate disclosure. Beyond alignment with regulation, how businesses leverage new regulations to drive business growth will separate the top-performers from the rest.
What is the Corporate Sustainability Reporting Directive (CSRD)?
CSRD affects over 50,000 companies worldwide– are you one of them? Learn more about the regulation (and steps to compliance) in this article!
Read the full articleDespite its challenges, the road to compliance reveals opportunities for long-term resilience, market competitiveness, and innovation. In the eyes of Vishnu Nair, Head of Zeigo Activate, increased pressure to disclose emissions data or other sustainability initiatives, “presents an opportunity for companies to… lower operating costs [through Energy Efficiency], increase talent retention [by setting & chasing a target], and access new sources of finance (Green Finance).”
Increased Interoperability in Reporting Frameworks
The regulatory environment is also expected to become more interconnected in 2025. In 2024, existing sustainability frameworks adjusted their standards to facilitate easier reporting and interoperability between systems.
For example, CDP, one of the largest sustainability disclosure systems in the world, and the European Financial Reporting Advisory Group (EFRAG) will be collaborating extensively in 2025 to strengthen commonality and interoperability between CDP and the European Sustainability Reporting Standards (ESRS). The alignment of these two systems is expected to help businesses manage compliance requirements more efficiently, reducing the administrative burden and enabling a clearer focus on sustainability goals.
In Europe, stricter supply chain regulations are emerging under directives such as the Corporate Sustainability Due Diligence Directive (CSDDD) and the Ecodesign for Sustainable Products Regulation (ESPR). These regulations will have far-reaching impacts, compelling businesses to adopt more rigorous sustainability practices throughout their supply chains.
For companies operating globally, understanding and navigating these diverse regulatory landscapes is crucial. The changes in policies and the push for regulatory compliance reflect a broader commitment to sustainability, requiring businesses to integrate these considerations into their strategies effectively. As these policies continue to evolve, businesses that stay ahead of the curve will be better equipped to succeed in a market increasingly defined by sustainability.
Renewable Energy Landscapes: “Change is the only constant”
In the words of Zeigo Power’s Head of Decarbonization and Energy Markets, Russell Reading, “change is the only constant” for renewable energy markets in 2025. Recent political shifts in major renewable energy markets have sparked uncertainty around whether investment conditions will improve or renewable energy targets will be hit. To combat this uncertainty, our experts suggest that companies stay informed on renewable energy markets, have a clear procurement strategy and plan in place, and remember to involve and educate stakeholders at every step of the decarbonization journey.
A change in focus is coming as established energy markets look to governments to support further growth whilst in emerging markets where renewables have historically had less grid penetration, new projects are more attractive giving growth in the sector.
Renewable Energy Battery Storage
According to our Head of Zeigo Network, Ian Lawrence, 2025 can expect to see a more dynamic pace and a consistent growth in demand when it comes to the development of battery storage technologies, particularly in regions like Europe where saturation is a growing concern. Adequate battery storage can mitigate issues related to the intermittency of renewable sources like solar and wind power, storing excess energy generated during peak production times and releasing it when demand is high.
Technological advancements in the renewable energy market, like batteries, are leading to change in the commercial side of the market too. Storage or Hybrid power purchase agreements are evolving to take advantage of the growth of battery storage, and multi-technology and aggregated contracts are helping to reduce risk, lower costs and enable more organizations to access renewable energy directly.
As renewable energy innovations continue to evolve, businesses have an unprecedented opportunity to enhance their sustainability initiatives. By staying informed and adopting these new technologies, companies can make significant strides in their decarbonization efforts while positioning themselves as leaders in the green economy.
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Sign up with Zeigo Network today!Business Approaches to Emissions Reduction
For years, corporate decarbonization has been considered at odds with a company’s financial growth. However, successfully harmonizing sustainability with business strategies is not only possible, but it will be critical for reaching global climate targets now and in the future.
“Waiting to decarbonize is costing your business. Here’s why:”
Go beyond the environmental benefits of decarbonization and discover how reducing your carbon footprint not only helps the planet, it can help your bottom line, too. Read the full article today!
Read the full articleIn essence, efficiency allows you to do more with less. As a result, businesses can leverage efficiency measures to improve productivity and drive business growth while reducing both energy costs and greenhouse gas emissions, making it an attractive decarbonization lever for companies of all sizes.
Energy efficiency in particular— such as the implementation of LED lighting, smart grids, and energy-efficient HVAC systems— is considered one of the most cost-effective decarbonization strategies in the near term, making it a particularly beneficial approach for companies lacking the resources to take on more expensive decarbonization measures. However, companies of all sizes are expected to double down on energy efficiency in 2025.
Another efficiency strategy expected to grow in 2025 is operational efficiency, which prioritizes optimizing business processes to improve productivity. While operational efficiency can drive emissions reduction across all scopes, it proves a significant opportunity for Scope 3 decarbonization. For most companies, Scope 3 emissions make up the majority of their total carbon footprint, which is largely comprised of the company’s supply chain. Operational efficiency measures, which range from optimizing supply chain logistics to centralizing supplier engagement efforts, will be significant opportunities for decarbonization in 2025. That said, Scope 3, is notoriously difficult to decarbonize, with companies lacking visibility into their own supply chains or struggling to properly engage their suppliers.
Central to efficiency efforts, both within direct operations and beyond, will be the use of advanced decarbonization software to monitor and manage company emissions. For companies of any size, a lack of high-quality data and difficulties transforming strategy into action are often the most significant obstacles to emissions reduction. Well-designed software solutions help companies overcome these obstacles by centralizing data, simplifying education, and leveraging the power of technologies like AI and IoT to identify emissions reduction opportunities.
Cross-industry collaboration also remains crucial in advancing sustainability goals. By sharing best practices and innovative solutions, businesses can drive collective progress and achieve more significant impacts. This cooperative approach not only accelerates decarbonization efforts but also fosters a community dedicated to a more sustainable future.
Digital Tools are Key to Decarbonization
Decarbonization software solutions are emerging as essential tools for businesses striving to reduce their carbon footprint. When asked about technological advancements to keep an eye on this year, Head of Zeigo Activate Vishnu Nair responded, “I think there’s this general perception that Carbon Management is this expensive complex endeavor that almost mandates a consulting-led bespoke approach. And while that may be true for large enterprises, it doesn’t need to be the case for midsized or smaller companies. Especially when you consider the advent of AI, I think we’re going to see more software like Zeigo Activate that simplifies the challenge and empowers businesses to manage their emissions journey on their own.”
Sustainability software solutions enable companies to gather and analyze emissions data accurately. By leveraging insights from advanced analytics, businesses can pinpoint inefficiencies and implement targeted improvements. The use of artificial intelligence further enhances these efforts by optimizing energy consumption patterns and facilitating the integration of renewable energy technologies.
Final Thoughts
As we look ahead, businesses will need to continue to innovate and adapt their strategies to meet evolving sustainability demands. Emerging technologies, evolving energy markets, and growing regulations are making it clearer than ever that decarbonization can no longer be supplemental but rather integral to your core business strategy.
Although the future of corporate decarbonization does not come without challenges, the opportunities for growth, innovation, and leadership only continue to grow. By staying ahead of trends and embracing new technologies, businesses can not only meet their sustainability goals but also thrive in a greener economy.